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IS 350 GOOD?

IS 350 GOOD?. A FINANCIAL LITERACY LESSON. Essential Questions for this lesson:. What does a lender consider when offering a loan?   Why is a credit score important?. What does this cartoon mean?. Definition of collateral:. Something that is pledged as security for repayment of a loan.

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IS 350 GOOD?

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  1. IS 350 GOOD? A FINANCIAL LITERACY LESSON

  2. Essential Questions for this lesson: • What does a lender consider when offering a loan?   • Why is a credit score important?

  3. What does this cartoon mean?

  4. Definition of collateral: Something that is pledged as security for repayment of a loan. The security can be taken as repayment by the lender if the borrower defaults (does not pay back) on the loan. Source: Dictionary.com. Retrieved from http://www.dictionary.com/browse/collateral

  5. Frayer Model:

  6. Is “350” good? What does it mean to have a 350 credit score?

  7. John wants a loan from the bank for a new motorcycle. The bank wants to know ALL of his monthly debt and his gross monthly income. This is what John tells them. Is John a good risk for a loan? Lenders look at your Debt-to-income ratio Monthly Debt: Apartment Rent: $350 Utilities: $ 50 Visa card: $ 50 Total $ 450 Monthly Income: Restaurant Job: $1,000 Evening (part-time) at a grocery store job: $ 200 Total $1200

  8. Financial Terms in this lesson: • Lender • Borrower • Collateral • Credit score • Interest rate • Credit history  • Credit application • Debt-to-income ratio

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